Work Rightsized- There has always been a shortage of workers, and Now everyone is finally realizing it.
The notion that there is a shortage of workers seems to have astounded people in the press, politics, and academia, but ask most workers and they’ll tell you it’s always been that way. And as job reports for the US show, this is very much intrinsic to the domestic work force, we work a lot in the United States. The shortage of workers, or more accurately, the need for workers to produce more than 100% of the expected output, has been a long-standing heuristic. So, why is it that there seem to be shortages everywhere now, it’s because up until the pandemic most people did the work of more than one person in an employer controlled environment. Salaried people regularly stayed at the office more than 40 hours per week, and hourly people regularly worked overtime. But with the dislocation brought about by the pandemic, this overwork became that much more obvious, and is no longer being tolerated.
Take a look at the chart below, you see the ratio of people working to the whole population, after a brief drop during COVID, has returned to a pretty normal place. Since 2006, when wage data began being recorded, the ratio was 59.7, it currently stands at 60.2, in other words, the same ratio of people working before the pandemic are still in the workforce. At the same time the average hourly wage has increased, a significant change in the two measures.
An increase in hourly wages has allowed hourly workers to reduce overtime, earn about the same amount, and spend time with their families, or at least away from work. This might also be thought of as a indicator of workers taking control of the “work/life” balance every employer claims to provide.
The chart above is a great example of the actual wage increases after dividing by the Consumer Price Index so that inflationary changes are taken into account.
> Salaried workers, who had a chance to stay away from an office where someone can see whether or not they were at their desk, have figured out that they are now in the drivers seat. By working only 40 hours per week, the work they were essentially not getting paid for now has to be done by someone else. And that has been multiplied across the economy so that there are essentially millions of unfilled jobs that were previously done for free.
> Consider that if there are five people each working 48 hours per week (and getting paid for 40), and all decide to work 40 hours, leaving 8 hours times 5, or 40 hours of work that’s going to require one more full time employee, just to stay even.
> When this is expanded across an economy the perception is that there is a mass shortage of employees, when in fact that shortage has always existed, it was just shouldered by workers.
This realization by employees in mass has led to an understanding, in many cases, that employers are powerless to force employees to work more or to fire them, because so many employers are in the same situation. This “rightsizing” of the workforce has been a long time in the making.
